June 7, 2018
Ben Horowitz, cofounder of Andreessen Horowitz and one of Silicon Valley’s most respected and experienced entrepreneurs, offers essential advice on building and running a startup—practical wisdom for managing the toughest problems business school doesn’t cover, based on his popular ben’s blog.
Basically as I go through any book that I read, I underline interesting ideas/quotes/paragraphs and then later come back through the book to get the lessons gleaned from these underpinnings and try to figure out what they mean to me and apply them to my own life.
Here were the most interesting lessons in the book for me:
It taught me that being scared didn’t mean I was gutless. What I DID mattered and would determine whether I would be a hero or a coward.
I was the only kid on the football who was also on the highest academic track in math, so my teammates and I didn’t see each other in many classes. As a result, I ended up moving around in multiple social circles and hanging out with kids with very different outlooks on the world. It amazed me how a diverse perspective utterly changed the meaning of every significant event in the world.
*cultivate a wide group of people for friends and partners, read widely, experience widely*
The simple existence of an alternate, plausible scenario is often all that’s needed to keep hope alive among a worried workforce.
I learned the most important rule of raising money privately: look for a market of one. You only need one investor to say yes, so it’s best to ignore the other thirty who say “no.”
Marc: do you know the best thing about startups?
Marc: you only ever experience two emotions: euphoria & terror. And I find that lack of sleep enhances them both.
People offer many complex reasons for why Bill rates so highly. In my experience it’s pretty simple. No matter who you are, you need two kinds of friends in your life.
The first kind is one who you can call when something good happens, and you need someone who be will excited for you. Not a fake excitement, veiling envy, but a real excitement. You need someone who will actually be more excited for you than he would be if it had happened to him.
The second kind of friend is somebody you can call when things go horribly wrong—when your life is on the line and you only have one phone call.
Who is it going to be? Bill Campbell is both of those friends.
“I thought that there was no way we’d be able to raise the money. We were going to go bankrupt for sure. I did not sleep more than two hours total during that entire 3-week trip.”
*we all feel this*
Needs always trump wants in mergers and acquisitions.
“I move onward, the only direction
Can’t be scared to fail in search of perfection.”
Frank revealed his plan to remove all of our software immediately, demanding all funds to be returned. He was dead serious.
Anthony remained calm, looked him in the eye, and said “Frank I will do as exactly as you say, I’ve heard you loud and clear and will call my boss now and give him your instructions.”
But before I do, can I ask you one thing? If my company made the commitment to fix these issues, how much time would you give us to do that?
(And he stayed on for 60 more days, this Is MASTER SALESMANSHIP)**
Figuring out the right product is the innovator’s job, not the customer’s job. The customer only knows what she thinks she wants based on her experience with the current product. The innovator can take into account everything that’s possible, but often must go against what she knows to be true.
As a result, innovation requires a combination of knowledge, skill, and courage. Sometimes only the founder has the courage to ignore the data.
Start up CEOS should not play the odds. When you are building a company, you must believe there is an answer and you cannot pay attention to your odds of finding it. You just have to find it. It matters not whether your chances are nine in ten or one in a thousand; your task is the same. I don’t believe in statistics, I believe in calculus.
Follow the first principle of the Bishkek—-the way of the warrior: keep death in mind at all times. If a warrior keeps death in mind at all times and lives as though each day might be his last, he will conduct himself properly in all his actions.
The struggle is when you wonder why you started the company in the first place.
The struggle is when people ask you why you don’t quit and you don’t know the answer.
The struggle is when food loses its taste.
The struggle is when you know that you are in over your head and you know that you cannot be replaced. The struggle is when everybody thinks your an idiot, but nobody will fire you.
The struggle is where self-doubt becomes self-hatred.
The struggle is when you are having a conversation with someone and you can’t hear a word that they are saying because all you can hear is the Struggle.
The struggle is when you want the pain to stop. The struggle is unhappiness.
The struggle is when you go on vacation to feel better and you feel worse.
The struggle is when you are surrounded by people and you are all alone. The struggle has no mercy.
The struggle is the land of broken promises and crushed dreams.
The struggle is a cold sweat. The struggle is where your guts boil so much that you feel like you are going to spit blood.
The struggle is not failure, but it causes failure. Especially if you are weak. Always if you are weak.
Most people are not strong enough.
This is not checkers; this is motherfuckin’ chess: Business is complex. The underlying technology moves, the competition moves, the market moves, the people move. AS a result, like playing three-dimensional chess on Star Trek, there is always a move.
Play long enough and you might get lucky. In business, tomorrow looks nothing like today. If you survive long enough to see tomorrow, it may bring you the answer that seems impossible today.
Remember that this is what separates the women from the girls. If you want to be great, this is the challenge. If you don’t want to be great, then you never should have started a company, go get a job.
The more brains working on the hard problems, the better.
In order to build a great company, you have to hire lots of incredibly smart people. IT’s a total waste to have lots of big brains but not let them work on your biggest problems. A brain, no matter how big, cannot solve a problem it doesn’t know about.
As the open source community would explain “given enough eyeballs, all bugs are shallow.”
No one is here to save you, there is no silver bullets, there are only lead bullets. You have to build a better product. There’s no other way out. No window, no hole, no escape hatch, no back door. You have to go through the front door and deal with the big, ugly guy blocking it. Lead bullets.
There comes a time in every company’s life where it must fight for it’s life. If you find yourself running when you should be fighting, you need to ask yourself “if our company isn’t good enough to win, then do we need to exist at all?”
Bill Parcells was coaching the Giants and was hit with a rash of injuries. He worried incessantly about the impact of injuries on his team’s fortunes, as it is difficult enough to win with your best players, let alone a bunch of substitutes.
When his friend & mentor, Raiders owner Al Davis, called Parcells to check in, Parcells relayed his issues.
Parcells: “Al, I am just not sure how we can win without so many of our best players. What should I do?”
David: Bill, nobody cares, just coach your team.
That might be the best business owner advice ever. Because, you see, nobody cares. When things go wrong in your company, nobody cares.
The media doesn’t care, your investors don’t care, your board doesn’t care, your employees don’t care, and even your mama doesn’t care.
And they are right not to care. A great reason for failing won’t preserve one dollar for your investors, won’t save one employee’s job, or get you one new customer. It especially won’t make you feel one bit better when you shut down your company and declare bankruptcy.
All the mental energy you use to elaborate your misery would be far better used trying to find the one seemingly impossible way out of your current mess.
Spend zero time on what you could have done and devote all of your time on what you might do.
Because in the end, nobody cares; just run your company.
“If you don’t know what you want, the chances that you’ll get it are extremely low.”
A startup must build a product that’s at least 10x better at doing something than the current prevailing way of doing that thing.
Two or three times will not be good enough to get people to switch to the new thing fast enough or in large enough volume to matter.
Create a Cult-Like Culture
You need to think about how you can be provocative enough to change what people do every day.
The key to this kind of mechanism if shock value. Think about The Godfather, ask a Hollywood mogul to give someone a job and he might not respond. Put a horse’s head in his bed and unemployment will drop by one. Shock is a great mechanism for behavioral change.
Asking yourself whether an executive is great can be extremely difficult to answer. A better question: For this company at this exact point in time, does there exist an executive who I can hire who will be better? If my biggest competitor hires that person, how will that impact our ability to win?
*judge partners by this as well*
Herb replied “I didn’t understand anything about your business and I understood very little about your industry. What I saw was two guys come visit me when every other public company CEO and chairman was hiding under their desk.
Not only did you come see me, but you were more determined and convinced you would succeed than guys running giant businesses. Investing in courage and determination was an easy decision for me.
Ideally, a CEO is urgent yet not insane. She will move aggressively and decisively without feeling emotionally culpable. If she can separate the importance of the issues from how she feels about them, she will avoid demonizing her employees or herself.
The key to getting to the right outcome was to keep from getting married to either the positive or the dark narrative.
Great CEOs face the pain. They deal with sleepless nights, the cold sweats, and what my friend the great Alfred Chiangmai calls “the torture.”
Whenever I meet a successful CEO, I ask them how they did it.
They all say “I didn’t quit.”
In all the difficult decisions I made through the course of running my companies, I never once felt brave. In fact, I often felt scared to death. I never lost those feelings, but after much practice I learned to ignore them. That learning process might also be called the courage development process.
Most people define leadership in the same way that Supreme Court justice Potter Stewart famously defined pornography when he said “I know it when I see it.”
We look for three key traits:
-the ability to articulate the vision
-the right kind of ambition
-the ability to achieve the vision
Giving watered-down feedback can be worse than no feedback at all because it’s deceptive and confusing to the recipient.
But don’t beat them up or attempt to show your superiority. Doing so will defeat your purpose because when done properly, feedback is a dialogue, not a monologue.
In order to make any decision, you must systematically acquire the knowledge of everything that might impact any decision that you might make. Questions such as:
-what are the competitors likely to do?
-what’s possible technically and in what time frame?
-what are the true capabilities of the organization and how can you maximize them?
-how much financial risk does this imply?
-what will the issues be, given your current product architecture?
-will the employees be energized or despondent about this promotion.
In well-run organizations, people can focus on their work (as opposed to politics) and have confidence that if they get their work done, good things will happen both for the company and for them personally.
Just when you think there are things you can count on in business, you quickly find that the sky is purple. When this happens, it usually does no good to keep arguing that the sky is blue. You just have to get on and deal with the fact that it’s going to look like Barney for a while.
In business, you rarely know everything up front. The difference between being mediocre and magical is often the difference between letting people take creative risk and holding them too tightly accountable.
Creative Risk= not stupid risks. Ex: There is risk with little or no chance of corresponding reward. Drinking a bottle of Jack Daniel’s then getting behind the wheel of a car is plenty risk, but there’s not much reward if you succeed.
The judgement you have to make is
A. Is this market really much bigger (more than an order of magnitude) than has been exploited?
B. Are we going to be number one?
If the answer to A or B is “no” then consider selling.
“I know you think my life is good cause my diamond piece
But my life been good since I started finding peace.”
The main that I try to convey to entrepreneurs today is to embrace your weirdness, your background, and your instinct.